How to Measure Office Hoteling Software ROI

By Devon Maresco
Marketing Coordinator
SpaceIQ

Of the many workplace changes to cement themselves in the wake of COVID-19, office hoteling is among the most prominent. To make hoteling work, companies have turned to desk booking software and hoteling systems to facilitate a seamless transition to this free-assign concept. Now, as businesses seek to refine their hoteling approach, they’re looking close at office hoteling software ROI and how to expand on those benefits. It begs the question: how do you measure hoteling software ROI?

To gauge any sort of ROI on hoteling takes a firm understanding of the variables at play. Are you tracking the right metrics? Do you have context for costs associated with office space? Is the software you’re using smart enough to report on trends and utilization to provide actionable insights? Here are a few of the finer points to consider when measuring office hoteling software ROI.

Establish hoteling metrics

What is hoteling without a clear set of metrics attached to it? This agile desking concept needs to produce clear and consistent data for facility managers to validate its effectiveness. Simply having desks and a booking system isn’t enough. Metrics need to show the nuances of when, how, and why employees book desks. Some of the most common metrics to track include:

• Total desk bookings per hour and per day
• Duration of desk reservation
• Occupancy rate of available desks (real-time)
• Types of desks and their utilization rates

The purpose of collecting this information and more is to understand the true ROI behind hoteling software. Given trend lines and data points there’s opportunity to recognize need, make adjustments, and improve utilization. These metrics not only shed light on ROI, they also illuminate how to increase it.

Track data and utilization trends

With the right benchmarks and KPIs loaded into office hoteling software, it becomes easier to understand utilization trends and how they contribute to ROI.

For example, say your established cost per workstation per day is $120. Then, say the average revenue generation capability per employee per hour is $40. Easy math says the breakeven point of each workstation is three hours. If you have desks that aren’t booked for more than three hours per day, you know automatically that those desks represent inefficiency.

Likewise, if you see that a certain type of desk books for an average of six hours per day, it can signal demand (and profitability) for that style of workstation. It may mean converting other desks to a similar style to spread out occupancy and improve broad utilization.

These are very basic examples. Facility managers need to look at the metrics they’re tracking to see how the context of hoteling compares to them and what that means for ROI potential.

Understand hoteling costs

The other side to understanding hoteling software ROI is understanding the costs inherent to hoteling. What does it cost you to operate an agile environment? There are two factors to consider. First, is the cost that goes into hoteling software and any IoT buildout that supports it. Second, is the cost of maintaining space used for hoteling.

It’s best to think about hoteling in binary. If there’s someone at the desk working, it’s reasonable to assume they’re generating profit. Likewise, if the seat remains unfilled, it’s an expense. For hoteling to be a profitable desking concept, companies need to understand the cost per seat and the breakeven point for each seat. Then, they need to orchestrate a hoteling solution that creates revenue beyond the fixed cost of a seat.

Hoteling costs vary for every company. An organization with 30,000 square feet of space and a mix of 250 hoteling options may have lower hoteling costs than a company with 10,000 square feet and 100 hotel workstations. Hoteling costs depend on factors such as cost per square foot, productivity output per employee, COGs, and other fixed overhead expenses that factor into the cost of operations.

To truly generate an ROI on hoteling software, do your best to find the fixed cost of an unoccupied desk and the revenue-generating potential of occupants at those desks. The breakeven point will tell the tale of hoteling ROI.

Adopt an ROI-driven mindset

One of the primary reasons behind calculating office hoteling ROI is to understand the costs of the workspace in a post-COVID-19 world. Employee work habits are different and so are their demands for space. Tracking and managing hotel desks is a realization of new trends. As these become the new norm, facility managers need benchmarks to let them know how efficient their facilities are. It starts with understanding cost.

With clear figures governing the ROI of hoteling software, facility managers can do a deep dive into opportunities for optimization. In the early phases of COVID-19 and a return-to-work, it might’ve been enough to pair people with desks. In the future, it’s going to revolve around how efficiently this occurs. That means looking at hoteling ROI as the benchmark for improvement.

Keep reading: Guide to Office Hoteling Best Practices